Displaying items by tag: Quinn Cement

Ireland: Quinn Building Products and Lagan Cement Group have signed a memorandum of understanding that could lead to a joint venture (JV) between the two groups.

The businesses, which will become part of the proposed JV, are the combined cement and building products businesses based in Ballyconnell, Derrylin, Kinnegad, Belfast, Cork and Benelux. Quinn Therm, Quinn Litepac, Quinn Tarmac and Lagan Sand are not included in this proposal.

Commenting on the proposed JV, the CEO of Quinn Manufacturing Group, Paul O'Brien, and the CEO of Lagan Cement Group, Jude Lagan, said, "By combining two stable Irish businesses the proposed JV will create a sustainable independent cement manufacturer that can continue to support its customers on a competitive basis."

The joint venture discussions are likely to take up to three months to complete and will involve the development of a business plan to combine the Quinn/Lagan cement and building products operations.

"While it is the intention of both parties to conclude a JV Agreement, no certainty can be assumed prior to the completion of these discussions and the relevant Competition Authority approvals," said a joint statement.

In a separate development, Quinn Manufacturing has also announced a Euro15m investment to upgrade its Ballyconnell cement plant, which, when completed, will facilitate the use of alternative fuels. The plant will be adapted to use solid recovered fuel (SRF), a move that will help to bring Quinn Cement's cost of production more into line with its Irish and European competitors.

Ireland: The Irish cement industry stands to make windfall profits of up to Euro50m 'at the taxpayers' expense,' according to sources familiar with the EU's emissions trading scheme (ETS). The sources estimate that companies such as CRH, Quinn Cement and Lagan Cement have made Euro26m over the past five years from the over-allocation of carbon credits by the government.

The sources estimate that the cement industry stands to make a further Euro25m when the next round of carbon credits is allocated under the ETS. The government allocates a certain amount of emission permits to companies for free. The idea is that polluting companies would buy credits in the market if they exceeded the permitted amount of emissions.

This system is known as 'cap-and-trade' but an initial over-allocation arose, partly because of the construction bust which meant that firms did not produce as much cement as expected. The sources said the transfer was a waste of public funds at a time when the exchequer was financially stressed. They also argued that the effect was to distort the market in favour of making cement.

The estimate of the scale of the subsidy comes after the Economic and Social Research Institute (ESRI) noted earlier in 2011 that the current EU ETS provided potentially large windfall gains for certain industries, such as electricity generation and cement production. The ESRI argued that such windfall gains should be recaptured by society through the tax system.

A spokesman for Cement Manufacturers Ireland did not dispute the figures, saying that the industry had invested millions of Euros in new technology upgrades to become one of the most efficient in Europe. "The current recession was not predicted when allowances were allocated under rules proposed by the Commission," he said.